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Berry v. Bank of America, N.A.

United States District Court, S.D. Florida

June 25, 2018

BANK OF AMERICA, N.A., Defendant.



         THIS CAUSE is before the Court upon Defendant Bank of America, N.A.'s (“Bank of America”) Motion to Dismiss, ECF No. [9] (the “Motion”). The Court has carefully reviewed the Motion, all opposing and supporting briefs, the record in this case, the applicable law, and is otherwise fully advised. For the reasons set forth below, the Motion is granted.

         I. BACKGROUND

         Plaintiffs, Ray Berry and Courtney Berry (collectively “Plaintiffs”), filed this action on April 4, 2018, against Bank of America for violations of the Fair Credit Reporting Act (“FCRA”), 15 U.S.C. § 1681. ECF No. [1]. According to the Complaint, Plaintiffs and Bank of America entered into a loan agreement secured by a mortgage. Id. at ¶ 11. While Plaintiffs made all required payments towards the loan for principal and interest, they allege that Bank of America improperly applied part of their payments toward escrow. Id. at ¶ 12-14. As a result, Plaintiffs' credit was adversely affected by showing a shortage of payments and a default under the loan. Id. at ¶ 17. Plaintiff alleges it notified Bank of America of its improper application of payments, by letter dated November 15, 2015, and demanded the correction of information reported to credit bureaus. Id. at ¶ 19. Despite its receipt of this letter, Bank of America failed to conduct a reasonable investigation and failed to supply accurate information to credit bureaus. Id. at ¶21. As a result, Plaintiffs allege that Bank of America violated 15 U.S.C. §§ 1681i and 1681s-2(B). Id. at ¶ 9.

         Bank of America moves to dismiss Plaintiffs' claims on three separate grounds: (1) lack of standing, (2) the FCRA's statute of limitations, and (3) failure to state a claim. See ECF No. [9]. Plaintiffs and Bank of America thereafter filed a timely response and reply respectively. See ECF Nos. [15] and [16]. The Motion is now ripe for review.


         A pleading in a civil action must contain “a short and plain statement of the claim showing that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2). Although a complaint “does not need detailed factual allegations, ” it must provide “more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007); see Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (explaining that Rule 8(a)(2)'s pleading standard “demands more than an unadorned, the-defendant-unlawfully-harmed-me accusation”). Nor can a complaint rest on “‘naked assertion[s]' devoid of ‘further factual enhancement.'” Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 557 (alteration in original)).

         When reviewing a motion under Rule 12(b)(6), a court, as a general rule, must accept the plaintiff's allegations as true and evaluate all plausible inferences derived from those facts in favor of the plaintiff. See Miccosukee Tribe of Indians of Fla. v. S. Everglades Restoration Alliance, 304 F.3d 1076, 1084 (11th Cir. 2002); AXA Equitable Life Ins. Co. v. Infinity Fin. Grp., LLC, 608 F.Supp.2d 1349, 1353 (S.D. Fla. 2009). However, this tenet does not apply to legal conclusions, and courts “are not bound to accept as true a legal conclusion couched as a factual allegation.” Twombly, 550 U.S. at 555; see Iqbal, 556 U.S. at 678; Thaeter v. Palm Beach Cty. Sheriff's Office, 449 F.3d 1342, 1352 (11th Cir. 2006). Moreover, “courts may infer from the factual allegations in the complaint ‘obvious alternative explanations,' which suggest lawful conduct rather than the unlawful conduct the plaintiff would ask the court to infer.” Am. Dental Ass'n v. Cigna Corp., 605 F.3d 1283, 1290 (11th Cir. 2010) (quoting Iqbal, 556 U.S. at 682). A court considering a Rule 12(b) motion is generally limited to the facts contained in the complaint and attached exhibits, including documents referred to in the complaint that are central to the claim. See Wilchombe v. TeeVee Toons, Inc., 555 F.3d 949, 959 (11th Cir. 2009); Maxcess, Inc. v. Lucent Techs., Inc., 433 F.3d 1337, 1340 (11th Cir. 2005) (“[A] document outside the four corners of the complaint may still be considered if it is central to the plaintiff's claims and is undisputed in terms of authenticity.”) (citing Horsley v. Feldt, 304 F.3d 1125, 1135 (11th Cir. 2002)). It is through this lens that the Court addresses the Motion.


         a. Standing

         Bank of America argues that Plaintiffs lack standing under Article III of the Constitution because they failed to allege a concrete injury. In its Reply, however, Bank of America appears to abandon this argument as it fails to address any of Plaintiff's arguments or case law cited in support of standing. Nonetheless, as standing presents a threshold question of subject-matter jurisdiction, the Court addresses whether Plaintiff satisfies the injury-in-fact requirement.

         To establish Article III standing, a “plaintiff must have (1) suffered an injury in fact, (2) that is fairly traceable to the challenged conduct of the defendant, and (3) that is likely to be redressed by a favorable judicial decision.” Spokeo, Inc. v. Robins, 136 S.Ct. 1540, 1547 (2016). “To establish injury in fact, a plaintiff must show that he or she suffered ‘an invasion of a legally protected interest' that is ‘concrete and particularized' and ‘actual or imminent, not conjectural or hypothetical.'” Id. at 1548 (citing Lujan v. Defenders of Wildlife, 504 U.S. 555, 560 (1992)). “For an injury to be particularized, it must affect the plaintiff in a personal and individual way.” Id. at 1548 (internal quotation marks omitted). “A concrete injury must be de facto; that is, it must actually exist.” Id. at 1548 (internal quotation marks omitted). “When we have used the adjective ‘concrete,' we have meant to convey the usual meaning of the term- ‘real,' and not ‘abstract.'” Id. at 1548. However, concrete injuries need not necessarily be tangible. Id. at 1549-50 (using the example of reporting an incorrect zip code as one that would not equate to any concrete harm, while inaccurately reporting a debt as delinquent would equate to concrete harm). In fact, a FCRA violation that causes a “material risk of harm” could be sufficient to confer Article III standing. Id. at 1550.

         Here, Plaintiffs sufficiently claim an “injury in fact” to satisfy Article III standing. Specifically, the Complaint alleges damages consisting of: (a) their impaired ability to rebuild creditworthiness; (b) misinformation provided to third-parties about the status of their account; (c) the loss of a line of credit; and (d) damage to their reputation. ECF No. [1] at ¶ 24. Plaintiffs' allegations demonstrate a particularized and concrete injury in that Bank of America provided inaccurate information about their payment history, which in turn affected their creditworthiness and resulted in the loss of a line of credit. See Keller v. Experian Info. Sols., Inc., No. 16-cv-04643-LHK, 2017 WL 130285, at *4 (N.D. Cal. Jan. 13, 2017) (finding that the plaintiff sufficiently alleged a concrete injury for Article III standing when the complaint claimed that inaccurate debt delinquency was reported) (citing Spokeo, 136 S.Ct. at 1549-50). In addition, Plaintiffs allege that they sustained damage to their reputation - another particularized and concrete “injury in fact.” See Gambles v. Sterling Infosystems, Inc., 234 F.Supp.3d 510, 524 (S.D.N.Y. 2017) (finding that inaccurate reporting of plaintiff's address history that “cast [plaintiff] as itinerant, shiftless, and risky, thereby undermining [plaintiff's] prospects for employment, ” was sufficient to establish a material risk of harm necessary for Article III standing). As such, the Court concludes that Plaintiffs have alleged a sufficient injury in fact to establish the existence of Article III standing.

         b. The ...

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